Apple stock decline called 'normal,' rebound expected by year end

Though Apple's stock has underperformed in the last 10 days, one analyst expects it to rebound by the end of the month before Apple closes out what is forecast to be a "blow-out" quarter.

Investors in recent days have become anxious as AAPL stock has given back some of its gains. Analyst Brian Marshall with Broadpoint AmTech issued a new note to investors Wednesday morning to state that Apple's decline is "normal" for Apple.

"Over the past 10 trading days, we have fielded numerous questions from the investment community regarding AAPL's ~8% underperformance relative to the S&P 500," Marshall said. "In our view, the move is 100% related to technicals and position sizing at the year-end... not indicative of fundamental trends."

The note forecasts that Apple's stock price will be over $200 once again by the end of 2009. Historically speaking, when Apple stock does rebound, it takes about as long as it did to drop. In other words, Marshall said, the rebound is typically a "mirror image" of the pull-back.

It's a similar sentiment to the one shared Tuesday by analyst Gene Munster of Piper Jaffray. Munster noted that Apple's stock price typically drops early in the year, and this year he believes the selloff is happening a little early.

Marshall still believes that it will be an "Apple Christmas," ushered in by demand for the iPhone, iPod touch, and a strong Mac lineup. He has forecast revenue of $12.5 billion for the December frame, with $2.27 earnings per share. Those numbers are about $650 million higher than Wall Street's averages.

The note forecasts a record quarter for Apple, with sales of 11.3 million iPhones, 3.3 million Macs, and 19.8 million iPods. With Apple adding more carriers overseas, Marshall expects to see significant international iPhone growth.

Compare those numbers with last quarter -- Apple's best ever -- when the company sold 3 million Macs, 7.4 million iPhones, and 10.2 million iPods. It earned profits during the frame of $1.67 billion.

"In our view, Apple remains the best technology company on the planet," Marshall said.

Broadpoint AmTech has reiterated its "buy" rating for AAPL stock, and has maintained a price target of $235.

Thank you for the graph, it will help me explain to my wife why I I hold AAPL as an amateur but large investor in AAPL buying in from 30's to 90's and why I don't mess with buying and selling on the short ups and downs. I'd be terrified of falling off the escalator if we missed an up!

From Apple ][ - to new Mac Pro I've owned them all.Long on AAPL so biased"Google doesn't sell you anything, Google just sells you!"

I started building this chart yesterday, but I never posted it. Since I saw another post about an analyst saying the decline was normal, my sell light went off in my head. Short squeeze today, but unless we we can maintain the 50 day VWAP for a week or two, shit is going to hit the fan soon. We can not ignore that AAPL is also tied to the market's general strengths and weaknesses, even if we know in the long term that their market position and business model is and will be successful. Guts of steel in the weak markets...right?

Perhaps the dollar will resume it's fall, what do i know about any of this. But what I do know is that a move is coming in equities, and it will rip some heads off, up or down. Look at the divergences: SPY, QQQQ, SMH, IYR, DJ-30 are stocking around their yearly highs, but the market's hot topic-crowded-trades like AAPl, GLD, short dollar, are looking really weak. More sideways action might prove to be the most frustrating to the market participants, but for how much longer before it gets too predictable again?

Impressive. Of course, if any of this made any sense we might not have had a massive crash in the financial system recently. Let's face it, it's all bollocks, and any share trade is basically a confidence trick. The more we pretend that any of this is sensible, the more likely it is that another bubble will burst in the near future and a massive bail out will be needed again. In the UK shareholders in a bankrupt bank are planning to sue the government for their losses, having spent the last several years claiming that their obscene profits are fair reward for the "risks" they take. A similar thing happened with the Lloyds "names" a few years back, and they got away with it. Privatised profit and socialised risk is great for those who profit, but fucked for the rest of us. If you're gonna play the market, be prepared to lose everything, or quit fucking whining.